Guess? Inc. (NYSE: GES) shares were under pressure over the last two months, due to the ongoing investigation into allegations of improper conduct by co-founder Paul Marciano. After trading in a narrow range of $15 in the last two months, GES stock regained momentum and resumed the uptrend today, amid stronger than expected fourth quarter results.

Guess has topped revenue and earnings estimates for the fourth quarter by $36 million and $0.08 per share, respectively. GES stock jumped 28% to $19, up almost 100% from the 52-week low of $10 it hit last year.

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Its total net revenue rose 17.5% to $792.2 million in the fourth quarter from $674.0 million in the same period last year, supported by revenue growth from Asian and European markets.  The company’s adjusted net earnings grew 40% Y/Y to $51.3 million in the fourth quarter, driven by higher revenue and increasing margin.

Its operating margin jumped 550 basis points to 8.6% from 3.1% in the year-ago period, amid lower asset impairment charges and favorable currency conversion impact.

Commenting on the results CEO said, “This quarter concludes a year where we saw revenue increase, operating profit growth, adjusted operating margin expansion and adjusted EPS growth of 52%. I believe that this year marks the beginning of a turnaround for the Company.”

Guess Dividends Are Safe

Guess? Inc. offers a quarterly dividend of $0.225 per share, yielding above 5%. Its dividend appears safe considering the robust growth in financial numbers and stronger than expected outlook for FY2018.

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The company expects its first-quarter revenue to grow by 12.5%, and full-year revenue is expected to surge by 8% with estimated earnings per share of $0.86-$0.98. Its cash generating potential also supports the dividend payments. The company generated $63 million in free cash flows last year while improving earnings would enhance free cash flow generation potential this year.

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